Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35 Page 36 Page 37 Page 38 Page 39 Page 40 Page 41 Page 42 Page 43 Page 44 Page 45 Page 46 Page 47 Page 48 Page 49 Page 50 Page 51 Page 52 Page 53 Page 54 Page 55 Page 56Bedfords Review | Issue Three 17 Property COMMENT George Osborne’s injudicious comment that a vote to leave might result in property values falling by 18% across the UK has lost him a considerable amount of credibility amongst property professionals and most people seem to have dismissed his forecast as no more than ill- considered political propaganda. My own crystal ball is hazy, but I suspect that a period of political uncertainty will continue through the summer and on into the autumn as a new Prime Minister is chosen and the negotiations commence regarding our new status in Brussels. In such circumstances, it is possible that some people may put their long-term plans on hold for the short term, although perhaps it is more likely that bricks & mortar will be seen as a safe haven in uncertain times. Nevertheless, the factors that underpin the property market remain unchanged. For whilst speculating on the housing market Reflecting upon the year to date, the market in East Anglia has been particularly buoyant. The rush to complete on the purchase of second homes and investment properties before an additional 3% was added to Stamp Duty on such purchases at the beginning of April resulted in a bubble, as one would expect, but since the bubble popped we have continued to sell well; indeed a number of houses have attracted multiple interest and sold in excess of guide, a sign that buyers retain confidence in the market. Sales of second homes have not diminished, although buyers have been acknowledging that they are liable for additional Stamp Duty when presenting their offers. Perhaps if Mr Osborne had not hiked up the rate of tax, our clients might have secured a marginally higher price for their houses? We cannot know for sure. So how will we fare in the coming months? As I sit and write this article, the referendum on our membership of the European Union is only just decided and the ramifications of our decision to leave and how this may affect the property market are unclear. Our analysis of the year to date; and our prediction for the remainder of the year. Market intervention and market forces is a media obsession, in truth it is easy to predict; it is a result of the forces of supply and demand.  Supply is determined by the number of houses for sale. This in turn is influenced by the number of houses being built; build fewer houses, fewer houses will be sold, thus limiting supply. Meanwhile, any long-term observer of the property market recognises that there is a causal link between interest rates and demand. Low interest rates result in cheaper mortgages and poor returns from cash deposits, in turn resulting in stronger demand from both borrowers and investors. Research by Shelter and KPMG suggests that we should build 250,000 houses each year in the UK to meet demand, yet since 2008 we have averaged just 143,000 each year and interest rates have been held at 0.5% since March 2009. Is it a coincidence that that market has seen sustained growth during this period? I don’t think so and my own prediction is that irrespective of the decision to leave the EU, whilst interest rates remain low and we continue to fail to build enough houses to meet demand, the value of our existing property stock will continue to rise. Ben Marchbank, Partner, Burnham Market office ‘Perhaps if Mr Osborne had not hiked up the rate of tax, our clients might have secured a marginally higher price.’